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Farming: controversial EU cap plans; EURO VIEW.

Byline: HUME HARGREAVE

THE EU Agriculture Commissioner, Marian Fischer Boel, has now had time to digest reactions to the proposals she made in the autumn. She found the greatest discontent with her plan to cap payments to the largest farmers.

No less then a third of the 27 member states, led by Germany and the UK, objected, so she has come up with a revised proposal.

The Commissioner would still like payments to farmers to be capped, and funds to be diverted from support for farmers to support for the environment and rural socioeconomic objectives ('modulation'), and so has suggested the two be combined.

She proposes that the thresholds of EUR100,000, EUR200,00 and EUR300,000 remain unchanged, as well as the existing exemption for payments below EUR5,000, and that the rate of increase in modulation should remain at 2% per annum, but start a year earlier in 2009.

Farmers entitled to between EUR5,000 and EUR100,000 would, if the Commissioner's proposals are approved, see 7% deducted from their single payments in 2009, rising to 13% by 2012.

Those entitled to between EUR100,000 and EUR200,000 would see 10% deducted in 2009, rising to 16%; those to between EUR200,000 and EUR300,000 13% rising to 19%; and those to more than EUR300,000 16% rising to 22%.

The effect on the largest farmers is less than under the Commissioner's original proposals, and to sugar the pill further, she suggests that all the funds deducted should remain at the disposal of the member state concerned; at present 20% may be reallocated to another member state by the Commission.

The Commissioner's proposal to increase the minimum area of claim from 0.3ha to 1ha is fiercely criticised by Greece and Cyprus, and unpopular with other member states with many very small farmers, but she is sticking to her guns, and to her plan to make EUR250 the minimum payment. That is understandable as apparently 46% of claimants are entitled to less than EUR500 per annum.

It seems that the Commission may allow payments for suckler cows and ewes in hill and marginal areas to remain coupled, ie, tied to the farm, but not elsewhere.

That, together with a proposed relaxation of the rules for national allocations of funds, might permit England, Scotland, Wales and Northern Ireland to take funds from arable and dairy farmers and give them to those farming in Less Favoured Areas or to some beef and sheep farmers.

It would also allow Scotland and Wales to move away from historic entitlements to regional average systems, but both may feel that is a step too far because the redistributions would have to take place in a three-year period, 2009 - 2012.

Thanks to Mrs Beckett, English farmers will have nothing but regional averages by 2012.

The elephant in the room is the EU Budget Review scheduled for next year. Perhaps the Commissioner's plans are intended to make the CAP less vulnerable by diverting funds to more politically acceptable policies.

The elephant in the room is the EU Budget Review scheduled for next year
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Title Annotation:Features
Publication:The Journal (Newcastle, England)
Geographic Code:4EUUK
Date:Apr 12, 2008
Words:517
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